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Antitrust Lawsuit Against Big Wall Street Banks Gets Approval
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An antitrust lawsuit filed against six major banks — The Goldman Sachs Group (GS - Free Report) , JPMorgan Chase & Co (JPM - Free Report) , Bank of America Corp (BAC - Free Report) , Credit Suisse Group AG , Morgan Stanley (MS - Free Report) and UBS Group AG (UBS - Free Report) — in August 2017, received a U.S. District Judge’s approval on Thursday. The lawsuit alleged the banks of jointly manipulating competitive scenario in the stock lending market since 2009. The news was reported by Reuters.
The banks have been given four weeks’ time to formally respond to the complaint made by the pension funds — Iowa Public Employees' Retirement System, California's Los Angeles County Employees Retirement Association, Orange County Employees Retirement System and Sonoma County Employees' Retirement Association and Torus Capital LLC.
The decision comes as a response to the request of dismissing charges that these banks had put forth in February 2018 to the U.S. District Judge Katherine Polk Failla in Manhattan. The banks had argued that the allegations put forth were “implausible on its face".
The pension funds had accused the banks of stifling growth of some start-up lending platforms, AQS and SL-x, by threatening and discouraging their potential clients. Also, the lawsuit states that the banks violated the federal antitrust law, also referred to as competition laws. Moreover, the funds said the conspiracy by the banks harmed investors and retirees by forcing them to pay high fees to engage in stock lending.
Notably, the plaintiffs had laid down several instances, which the judge found sufficient to indicate that some improper activity was conducted at the time. Per one of those instances, Goldman Sachs supposedly threatened to end business ties with The Bank of New York Mellon (BK - Free Report) in 2012 in case it continued to support the AQS platform, post which, the latter had agreed to the terms.
Further, the lawsuit said that through a joint project called EquiLend LLC, the banks purchased SL-x’s intellectual property and shelved it. Also, the funds accused the banks of establishing EquiLend in 2001 to safeguard their interests in the stock lending market.
Legal headwinds have been mounting for banks as they continue to face several cases and probes regarding the business conducted previously. Though the banks have resolved many litigation issues over the past years, rising legal hassles keep dragging the companies' financials downward.
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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Antitrust Lawsuit Against Big Wall Street Banks Gets Approval
An antitrust lawsuit filed against six major banks — The Goldman Sachs Group (GS - Free Report) , JPMorgan Chase & Co (JPM - Free Report) , Bank of America Corp (BAC - Free Report) , Credit Suisse Group AG , Morgan Stanley (MS - Free Report) and UBS Group AG (UBS - Free Report) — in August 2017, received a U.S. District Judge’s approval on Thursday. The lawsuit alleged the banks of jointly manipulating competitive scenario in the stock lending market since 2009. The news was reported by Reuters.
The banks have been given four weeks’ time to formally respond to the complaint made by the pension funds — Iowa Public Employees' Retirement System, California's Los Angeles County Employees Retirement Association, Orange County Employees Retirement System and Sonoma County Employees' Retirement Association and Torus Capital LLC.
The decision comes as a response to the request of dismissing charges that these banks had put forth in February 2018 to the U.S. District Judge Katherine Polk Failla in Manhattan. The banks had argued that the allegations put forth were “implausible on its face".
The pension funds had accused the banks of stifling growth of some start-up lending platforms, AQS and SL-x, by threatening and discouraging their potential clients. Also, the lawsuit states that the banks violated the federal antitrust law, also referred to as competition laws. Moreover, the funds said the conspiracy by the banks harmed investors and retirees by forcing them to pay high fees to engage in stock lending.
Notably, the plaintiffs had laid down several instances, which the judge found sufficient to indicate that some improper activity was conducted at the time. Per one of those instances, Goldman Sachs supposedly threatened to end business ties with The Bank of New York Mellon (BK - Free Report) in 2012 in case it continued to support the AQS platform, post which, the latter had agreed to the terms.
Further, the lawsuit said that through a joint project called EquiLend LLC, the banks purchased SL-x’s intellectual property and shelved it. Also, the funds accused the banks of establishing EquiLend in 2001 to safeguard their interests in the stock lending market.
Legal headwinds have been mounting for banks as they continue to face several cases and probes regarding the business conducted previously. Though the banks have resolved many litigation issues over the past years, rising legal hassles keep dragging the companies' financials downward.
All of the above-mentioned banks currently have a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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